Capital gains taxes are taxes that you owe on capital gains. The long-term capital gains tax rate is lower than the tax rate on ordinary income. To qualify for the long-term capital gains tax rate, you need to hold a capital asset (such as an investment or home) for more than one year. That means 366 or more days. Gains on capital assets held for more than one year are called long-term capital gains. Gains on capital assets held for one year or less are called short-term capital gains. Short-term capital gains are taxed at the same rate as ordinary income. The long-term capital gains tax rate for most taxpayers is 15% or 20%. However, if you are in the 10% or 15% income tax bracket, the long-term rate is 0% for 2013.
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